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Hail, Caesar(stone)!  TMOB’s Refusal To Consider Earlier Registration Of Related Goods Unreasonable

In Caesarstone Sdot-Yam Ltd v. Ceramiche Caesar S.P.A., Justice Manson of the Federal Court allowed part of an appeal from a Trademarks Opposition Board decision refusing part of the requested scope of an application for the registration of the trademark.

Caesarstone Sdot-Yam Ltd. had filed an application to register the trademark CAESARSTONE & Design. Ceramiche Caesar S.p.A. opposed the registration on the basis of alleged confusion with its registered trademark CAESAR & Design. The marks are as follows:

The TMOB refused the registration. Caesarstone appealed and filed 10 new affidavits as evidence in support of its registration, which is permitted under subsection 56(5) the Trademarks Act.

The issues on appeal were questions of fact or mixed fact and law. Such issues are reviewable on a correctness standard only if there is new material evidence before the Court. The appellant argued that its 10 new affidavits addressed the deficiencies that the TMOB perceived in the original evidence. However, the Court found the new evidence could not have materially affected the TMOB’s decision and the standard of review was thus one of reasonableness. The Court relied on the evidentiary requirement necessary to affect the standard of review as set out in Levi Strauss & Co v Vivant Holdings Ltd.: “If the additional evidence does not go beyond what was in substance already before the board and adds nothing of probative significance, but merely supplements or is merely repetitive of existing evidence, then a less deferential standard is not warranted”. Although from different affiants, Caesarstone’s newly filed affidavits merely repeated evidence that was before the TMOB or discussed matters not actually relevant to the issue of confusion.

Nonetheless, the appeal was allowed in part.

The Respondent’s opposition pertained only to a subset of Caesarstone’s services, specifically as it related to “tiles, slabs and tiles formed of composite stone and walls and wall cladding” (the Opposed Services). Caesarstone argued that the TMOB failed to consider an earlier trademark it had registered for the word “CAESARSTONE” in relation to “work tops, sink tops, work surfaces and surrounds for kitchens, bathrooms, vanity units and offices, countertops, table tops”. The TMOB held that the Opposed Services were a departure from, or an expansion of, the Applicant’s kitchen and bathroom installation business into the general flooring market and that the Trademarks Act does not give an automatic right to obtain further registrations no matter how closely they may be related to an original registration.

Justice Manson found that the TMOB did not properly consider the relationship between the Opposed Services and the goods under Caesarstone’s earlier trademark. The earlier registration was broad enough to encompass the scope of the Opposed Services in the new application. Justice Manson held that the decision to afford no weight to the existing registration, and the conclusion that that the Opposes Services were a “departure from” the goods covered by the earlier registration fell outside the range of possible, acceptable outcomes which are defensible in respect of the facts and law.

Caesarstone advanced a number of other grounds of appeal, all of which were dismissed.  Of note, it argued that the TMOB failed to give weight to the nature of the parties’ goods as being relatively expensive and unlikely to be purchased by consumers on a “spur of the moment” basis. While a consumer in the market for expensive goods may be somewhat more aware of the trademark associated with the wares or services they are examining, the test is still one of “first impression”. Where a strong resemblance suggests a likelihood of confusion, and other relevant factors do not strongly indicate the contrary, the cost of the goods is unlikely to be persuasive.

The Court referred the matter back to a different member of the TMOB for redetermination in light of the Court’s reasoning on the sole ground of appeal that was allowed.

A copy of the judgment can be found here.